Introduction
You may be considering a Medigap (or ‘Medicare Supplement’) plan to help manage your costs if you are currently receiving Medicare coverage through Original Medicare.
In total, there are 10 Medigap plans available: Plans A, B, C, D, F, G, K, L, M, and N. Each plan provides a different level of coverage which is standardized and determined by the government. For example, a Plan G from Company A provides exactly the same coverage as Plan G from Company B. Insurance companies that sell Medigap policies don’t have to offer every Medigap plan but must offer Medigap Plan A if they offer any Medigap policy.
As Medigap plans are standardized, the only difference when comparing the same plan across different private insurance companies is the price and the insurer’s reputation.
What does each Medigap plan cover?
Medigap policies help to pay for the out-of-pocket costs (deductibles, copays and coinsurance), also referred to ‘gaps’ in Original Medicare, in return for a monthly premium that you pay the private insurance company. This premium is in addition to your standard Medicare Part B premium ($170.10 in 2022, or higher depending on your income thresholds). Purchasing a Medigap plan effectively shifts the burden of paying for out of pocket costs to the insurance company and for covered services, Medigap will effectively all or most of the out-of-pocket costs
In total, there are 10 Medigap plans available: Plans A, B, C, D, F, G, K, L, M, and N each with a different level of coverage. There are other Medigap plans that are no longer for sale including Plans E, H, I, and J. However, they still offer their original coverage to those who had previously purchased these plans.
| Plan A | Plan B | Plan C | Plan D | Plan F* | Plan G* | Plan K | Plan L | Plan M | Plan N | |
|---|---|---|---|---|---|---|---|---|---|---|
| Part A coinsurance and hospital costs up to an additional 365 days after Medicare benefits are used up | Y | Y | Y | Y | Y | Y | 50% | 75% | Y | Y |
| Part B coinsurance or copayment | Y | Y | Y | Y | Y | Y | 50% | 75% | Y | Y*** |
| Blood (first 3 pints) | Y | Y | Y | Y | Y | Y | 50% | 75% | Y | Y |
| Part A hospice care coinsurance or copayment | Y | Y | Y | Y | Y | Y | 50% | 75% | Y | Y |
| Skilled nursing facility care coinsurance | — | – | Y | Y | Y | Y | 50% | 75% | Y | Y |
| Part A deductible | — | Y | Y | Y | Y | Y | 50% | 75% | 50% | Y |
| Part B deductible | — | — | Y | – | Y | – | — | – | – | – |
| Part B excess charge | — | – | – | – | Y | Y | – | — | – | – |
| Foreign travel exchange (up to plan limits) | — | — | 80% | 80% | 80% | 80% | — | – | 80% | 80% |
| Out-of-pocket limit** | N/A | N/A | N/A | N/A | N/A | N/A | $6,940 in 2023 | $3,470 in 2023 | N/A | N/A |
Notes: Y = Yes, — = Not Covered
* Plans F and G also offer a high-deductible plan in some states. With this option, you must pay for Medicare-covered costs (coinsurance, copayments, and deductibles) up to the deductible amount of $2,700 in 2023 before your policy pays anything. (Plans C and F aren’t available to people who were newly eligible for Medicare on or after January 1, 2020.)
** For Plans K and L, after you meet your out-of-pocket yearly limit and your yearly Part B deductible, the Medigap plan pays 100% of covered services for the rest of the calendar year.
*** Plan N pays 100% of the Part B coinsurance, except for a copayment of up to $20 for some office visits and up to a $50 copayment for emergency room visits that don’t result in inpatient admission.
Which is Medigap most popular?
Based on data from AHIP Center for Policy and Research, the following plans are the most popular are as follows:
| Plan type | % of total Medicare Supplement enrollees |
|---|---|
| Plan F | 46% |
| Plan G | 27% |
| Plan N | 10% |
| Plan C | 4% |
| Plan I | 2% |
| Plan A | 1% |
| Plan B | 1% |
| Plan D | 1% |
| Plan K | 1% |
| Plan L | < 0.5% |
| Plan M | < 0.5% |
| Other | 6% |
*Includes high-deductible Plan F.
** Includes high-deductible Plan G.
Source: AHIP Center for Policy and Research analysis of the NAIC
Medicare Supplement Insurance Experience Exhibits, for the Years
Ended December 31, 2017; December 31, 2018; December 31,
2019 and December 31, 2020.
Traditionally, Medigap Plan F was the most comprehensive and most popular Medigap policy (with 53% of those enrolled in Medigap policy choosing Plan F) you could purchase that effectively covered all of your out-of-pocket costs under Original Medicare.
However, starting in 2020, Federal rules have changed so that Medigap plans that pay the Medicare Part B deductible will no longer be sold to those newly eligible for Medicare on or after January 1, 2020. This means Plans F and C can no longer be purchased if you are eligible after 2019.
As a result of this rule change, Plan G will now likely be the most popular plan as it provides the next most comprehensive coverage. Plan G has historically also been the second most popular plan with around 17% of those enrolled in Medigap picking Plan G followed by Plan N which 10% of Medigap enrollees have purchased.
Final Words
Plan F has traditionally been the most popular choice for Medicare beneficiaries who have purchased a Medigap plan. However, starting January 1, 2020 Medicare Plan F and C plans will no longer be available to purchase for newly eligible Medicare beneficiaries. As such, it is expected in the future Plan G will become the most popular choice as it provides the next most comprehensive level of coverage, followed by Plan N.
At CoverRight, we’re here to help you find the right coverage that you deserve. Reach out today and start finding the best Medicare plan for you.
